Real Estate Lawyer in Houston discusses certain aspects of homestead laws in Texas, including the life estate. What happens to the property when a spouse dies?
Several good articles exist about what is a homestead in Texas, and how creditor’s rights are affected, but what happens when someone is married and his spouse owns their homestead as separate property? It’s clear that the Constitution of Texas disallows the sale of a marital homestead, even if the property is separate property, without the consent of both spouses. Article 50(b) of the Constitution says that “[a]n owner or claimant of the property claimed as homestead may not sell or abandon the homestead without the consent of each owner and the spouse of each owner, given in such manner as may be prescribed by law.” Tex. Const. art. XVI, § 50(b). Cases have interpreted that to mean that “[u]nder Texas law, a spouse has a homestead interest in the other spouse’s separate property even after the spouse who owns full fee simple title to the property dies.” In re Odes Ho Kim, 748 F.3d 647, 660 (5th Cir. 2014). The key is in the word interest. The surviving spouse is not an owner, but rather has an interest in the property.
What interest does that surviving spouse have? “[T]he surviving wife is as fully protected in the use and occupancy of a homestead on the separate property of her deceased husband as she would be on property that belonged to their community estate.” Lucas v. Lucas, 104 Tex. 636, 641, 143 S.W. 1153, 1155–56 (1912). There is at least one, rare exception. If the government takes a homestead by way of eminent domain, the it appears that a court should take the money from the sale to the government and reinvest in a new homestead for the benefit of a surviving spouse. Id.
If the deceased spouse had not sold the property prior to her death, then the ownership interest in the homestead will pass to the heirs however the law dictates, but “among the heirs of the deceased during the lifetime of the surviving husband or wife” the homestead may not be sold. Tex. Const. art. XVI, § 52. This means that the surviving spouse may live there until he or she dies. In other words, she has a life estate.
In this State, homestead interest of each spouse or the surviving spouse in the homestead property constitutes an estate therein, and is treated as a life estate, so long as the property retains its homestead character. This is true, whether the fee title to the homestead property belongs to the separate estate of either or both spouses, or to their community estate.
Sparks v. Robertson, 203 S.W.2d 622, 623 (Tex. App.—Austin 1947, writ ref’d)
The homestead interest is only lost by death or abandonment. U.S. v. Rodgers, U.S. Tex.1983, 103 S.Ct. 2132, 461 U.S. 677, 76 L.Ed.2d 236, on remand 712 F.2d 990.
The Constitution, cited above, clearly prohibits the sale of homestead property (“may not sell or abandon the homestead”) without the consent of the spouse. What happens if he does so anyway?
“A conveyance by a husband, not joined by his wife, of homestead property, is not void but is merely inoperative while the property continues to be homestead, or until such time as the homestead may be abandoned, or the deed ratified in accordance with law.” Zable v. Henry, 649 S.W.2d 136, 137 (Tex. App.—Dallas 1983, no writ); accord Bishop v. Williams, 223 S.W. 512, 515 (Tex. App.—Austin 1920, writ ref’d)([A] homestead right attaches to separate as well as community property, if it be conceded that the property in question was the homestead of himself and wife when he undertook to deed it back to his mother [as a gift], as his wife did not join in either of the deeds referred to, such attempts to convey were inoperative as long as the property remained homestead.”)
There is a similar result in Gilley. In that case, a husband owned a separate piece of real estate that became a homestead to him and his wife. Gilley v. Troop, 146 S.W. 954, 955 (Tex. App.—Fort Worth 1912, writ ref’d). While she was in an asylum, the husband sold the property. The Court talks first about her capacity issues, it later talks about the husband’s general right to convey his separate property, and that the wife lost her life estate by abandoning the property. Similarly, in Kelly, a surviving husband recognized that his wife’s son from a former relationship, got title to the homestead (which was his wife’s separate property) through her will, but he was able to show that he was entitled to a life estate, because it was their homestead. Kelly v. Nowlin, 227 S.W. 373, 375 (Tex. App.—Texarkana 1921, no writ)(wife had abandoned homestead, but husband had not; husband still had homestead).
A similar principle applies to contracts to convey.
[T]he Supreme Court of Texas stated that while a husband possibly could not have been compelled to execute a conveyance of homestead property without the consent of his wife, the contract as to him “was not unlawful, but good and valid, and he might have been sued for damages during the life of his wife, and at her death he may be compelled to execute the deed, in compliance with his previous contract….” 34 Tex. at 261. In Brewer v. Wall, 23 Tex. 585, 589 (1859)
Zable v. Henry, 649 S.W.2d 136, 137 (Tex. App.—Dallas 1983, no writ)
Even though a sale is valid, though inoperable until the death of the surviving homestead, the same is not true of certain deeds of trust. Instead, they are absolutely void as to the homestead, if the owner of the lien did not adhere to the Constitution.
Other decisions reflect that the Texas courts have adhered strictly to the principle that one-spouse homestead transactions are not void, but are merely inoperative while the property remains the non-signing spouse’s homestead. See Reserve Petroleum Co. v. Hodge, 147 Tex. 115, 213 S.W.2d 456, 458 (1948); Kunkel v. Kunkel, 515 S.W.2d 941, 948 (Tex.Civ.App.—Amarillo 1974, writ ref’d n.r.e.); Davis v. Crockett, 398 S.W.2d 302, 307 (Tex.Civ.App.—Dallas 1965, no writ); Lewis v. Brown, 321 S.W.2d 313, 317 (Tex.Civ.App.—Fort Worth 1959, writ ref’d n.r.e.); *138Weinert v. Cooper, 107 S.W.2d 593, 595 (Tex.Civ.App.—Texarkana 1937, writ dism’d). See also, Hill v. McIntyre Drilling Co., 59 S.W.2d 193, 195 (Tex.Civ.App.—Texarkana 1933, writ ref’d). In Lewis v. Brown, supra, (which, like the instant case, involved an option to purchase property)[321 S.W.2d at 317] the law regarding single spouse homestead transactions was summarized as follows:
Deeds of trust and levies of execution or attachment never become liens on property which is homestead at the time of their execution or levy, even after the homestead status ceases to exist. This is so because Article 16, sec. 50, of the Texas Constitution, Vernon’s Ann. St., declares them to be void. The subsequent cessation of the homestead exemption does not give them validity. But a contract to sell a homestead is not void, and “not unlawful but good and valid.” Wright v. Hays, 34 Tex. 253. It is merely unenforceable so long as the homestead status exists. Hudgins v. Thompson, 109 Tex. 433, 211 S.W. 586; Hill v. McIntyre Drilling Co., Tex.Civ.App., 59 S.W.2d 193. Likewise, while a judgment cannot become a lien on property which is homestead, it does become a lien when the homestead exemption ceases. Marks v. Bell, 10 Tex.Civ.App. 587, 31 S.W. 699, error refused. The sale of the homestead by the husband, without the joinder of the wife, becomes operative when the property ceases to be a homestead. Marler v. Handy, 88 Tex. 421, 31 S.W. 636; Irion v. Mills and Halbert, 41 Tex. 310; Grissom v. Anderson, 125 Tex. 26, 79 S.W.2d 619; Weinert v. Cooper, Tex.Civ.App., 107 S.W.2d 593.
Zable v. Henry, 649 S.W.2d 136, 137–38 (Tex. App.—Dallas 1983, no writ)